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World stock markets rally

31 July 2009 07:59 (UTC +04:00)

Baku- APA-Economics. Upbeat corporate earnings are giving stocks another burst of energy.
Stocks surged Thursday as stronger-than-expected profit reports and a surprise drop in the number of people continuing to seek unemployment benefits handed investors the latest evidence that the economy could be strengthening.
Major stock indicators rose more than 1 percent, including the Nasdaq composite index, which crossed 2,000 for the first time since October. The Dow Jones industrial average jumped 150 points.
In late afternoon trading, the Dow rose 151.15, or 1.7 percent, to 9,221.87. The Standard & Poor’s 500 index rose 18.47, or 1.9 percent, to 993.62. The index hasn’t traded above 1,000 since November.
The Nasdaq advanced 29.32, or 1.5 percent, to 1,997.08. It rose to nearly 2,010 in morning trading, its first move above 2,000 since Oct. 3. The index is up more than 55 percent from its low of 1,269 in March.
About 2,500 stocks rose on the New York Stock Exchange, while only about 500 fell. Volume came to 949.5 million shares, compared with 776.4 million traded at the same point Wednesday.
The climb extends a rally that began July 13 when companies started reporting profits that exceeded analysts’ modest expectations. Stocks made little progress in the last four days but some break in the buying had been expected after major stock indicators jumped 11 percent in two weeks.
Profit reports this month from some of the nation’s best-known companies have boosted confidence that the longest recession since World War II might end this year. AT&T Inc., chip maker Intel Corp. and heavy equipment maker Caterpillar Inc. have posted results that were stronger than analysts had forecast.
Three out of four companies in the S&P 500 index that have reported results have topped analysts’ expectations, according to Thomson Reuters. About 300 of the 500 companies have reported.
Investors rewarded the latest companies to beat expectations. Motorola rose 62 cents, or 9.4 percent, to $7.19. Goodyear rose $1.96, or 14.1 percent, to $15.85. Dow Chemical rose $1.35, or 6.7 percent, to $21.62.
GE rose $1.05, or 8.6 percent, to $13.31 and was the biggest gainer among the 30 stocks that make up the Dow industrials.
Bond prices were mixed after a successful auction of $28 billion of seven-year notes. Weak demand at auctions earlier in the week raised concerns that the government might have to offer higher returns on bonds to lure in investors, which would have the negative effect of raising borrowing costs on loans such as mortgages.
The yield on the benchmark 10-year Treasury note, which moves opposite its price, fell to 3.64 percent from 3.67 percent late Wednesday.
Light, sweet crude rose $3.57 to settle at $66.92 a barrel on the New York Mercantile Exchange after tumbling 6 percent Wednesday on fears economic growth in China would slow and curb demand for resources.
The dollar was mixed against other major currencies, while gold prices rose.
The Russell 2000 index of smaller companies rose 12.36, or 2.3 percent, to 560.74.
Overseas, Britain’s FTSE 100 gained 1.9 percent, Germany’s DAX index gained 1.7 percent, and France’s CAC-40 rose 2.1 percent. Japan’s Nikkei stock average rose 0.5 percent. Source: AP